February is the real opening of the New Year’s Casino. Investors place their bets–and the dealer’s stick clears the losers.
RadAI’s Series C racks up $60 million. The generative AI radiology company gained an oversubscribed round led by Transformation Capital, with participation from existing investors Khosla Ventures, World Innovation Lab, UP2398, Kickstart Fund, OCV Partners, Cone Health and others. It follows a $50 million Series B in May 2024 and boosts the company’s value to $525 million. RadAI’s two products to speed radiology workflows and findings are Rad AI Impressions, their first product, and Continuity for interpretation and follow up for potential new cancers. RadAI claims that their platforms are used by radiologists performing about 50% of all US medical imaging. In July 2024, it partnered with Bayer to bring its capability to Bayer’s Calantic Digital Solution customers. Release, Mobihealthnews
The niftily named The Helper Bees nabbed $35 million in a Series C. This was a tidy amount for the formerly unsexy independent aging technology sector, led by Centana Growth Partners, with support from Silverton Partners, Impact Engine, Northwestern Mutual Future Ventures, and Alumni Ventures. The Austin, Texas-based company works through 43 health plans (payers) by providing national access to non-medical products and services such as in-home caregiving, home modifications, groceries and meals, pest control, housekeeping, lawn care, and transportation, closing significant care gaps in senior care and enabling aging in place. They support long-term care plans and Medicare Advantage. Their total funding is $54 million. Release, Mobihealthnews
Bicycle Health pedals to a $16.5 million raise, profitability. Bicycle’s telehealth platform for opioid use disorder (OUD) treatment has had its downs (a May 2024 layoff of 15% of staff) and ups (a $50 million Series B in 2022). Their latest up is turning profitable on an EBITDA and net income basis as of Q4. In the middle is the just-announced unlettered down round led by existing investor Questa Capital, with participation from all other existing investors including SignalFire, Frist Cressey Ventures, City Light Capital, InterAlpen Partners, Valeo Ventures, and Hustle Fund, as well as new investor JSL Health. Added to the C-level roster are CFO Manu Kuppalli and COO Andy Thomas, with a background in brick-and-mortar behavioral health. Release, Endpoints, Mobihealthnews
On the loser’s side of the table
Walgreens suspends their quarterly dividend for the first time in 91 years. The rationale for ending the shareholder payments made since 1933 was announced late last Thursday “as management continues to evaluate and refine its capital allocation policy consistent with the company’s broader long-term turnaround efforts”. The admission was blunt: “The company’s cash needs over the next several years, including with respect to litigation and debt refinancing, were important considerations as part of the decision to suspend the dividend.” The share price promptly took a hit going from $11.43 at market close on Thursday to closing today (Tuesday) at $9.84, not exactly a desired result. Walgreens’ days as a ‘widows and orphans stock’ are long over.
- The litigation is a serious matter, with the Department of Justice (DOJ) filing a civil suit 16 January in Illinois over improper dispensing of opioids and other unlawful medications over more than a decade, in violation of the Controlled Substances Act (CSA).
- The WBA Q3, announced mid-January, widened its net loss to $265 million.
- Walgreens is in the midst of closing 1,200 locations to get out from under real estate.
- The rest is not much different than other retail–in-store theft, pharmacy sales erosion, and retail sales going online or elsewhere.
- Mistakes such as buying VillageMD (and doubling down with Summit Health and CityMD) made it 10x worse.
Will this put the brakes on a sale? Certainly Sycamore Partners and other interested parties now must rethink their pricing and timing, though it may be positive if it improves WBA’s cash position. [TTA 10 Dec 2024, 8 January] Release, CNBC, AP
Did Transcarent, after paying $100 million for 98point6’s virtual care platform in 2023, just pull the plug on the service? This tidbit from a commenter on HIStalk News 2/5/25 indicates that Transcarent may have. Exhibit 1 is a notice from Allegheny College (PA), a service customer for about two years, on their blog that students and staff were notified on 19 December that the service was going out of business. The college is searching for a replacement telehealth service. The Allegheny page is also showing up high in Google Search results.
Transcarent has a live 98point6 page with FAQs about the service and buttons for downloads on Google’s and Apple’s respective App Stores. There is no notice on Transcarent’s 98point6 page, but their last blog posting mentioning 98point6 was October 2024. On Google’s App Store, the last update is listed as 5 June 2024, which is unusual for a telehealth app. The app ownership is credited to Transcarent so it is not a leftover from the original company. According to the HIStalk commenter, most staff was laid off by April 2024. (As we reported in our 8 May 2024 report, 98point6 had only 100 on staff, and the number of those laid off was unknown.)
Confusing matters is that 98point6 continues as a platform, but not as a telehealth service. After they sold their virtual care service to Transcarent [TTA 9 Mar 2023], they announced a pivot into licensing its real-time and asynchronous software to third parties, including Transcarent. Less than a year later, 98point6 bought the remaining assets of telehealth provider Bright.md not sold to Evernorth’s MDLIVE–17 asynchronous telehealth provider customers [TTA 19 Jan 2024]. We have reached out to Transcarent for confirmation. They are welcome to reach out to TTA (email Editor Donna).
Leave a Reply